The Impact of the Foreign Account Tax Compliance Act (FATCA)
FATCA, the Foreign Account Tax Compliance Act, targets those who evade paying taxes by hiding assets in undisclosed foreign bank accounts but negatively impacts and penalizes American citizens overseas and US economic interests.
FATCA requires Foreign Financial Institutions (FFIs) to provide annual reports to the IRS, either directly or through...
Two members of the Americans Abroad Caucus (Representatives Mike Honda of California and Carolyn Maloney of New York) have been joined by Representative Jim McDermott of Washington in requesting that the U.S. Government Accountability Office conduct a review of the potential impacts of any reduction in or elimination of current I.R.S provisions for exclusion of foreign-earned income and housing costs...
On June 26, the IRS issued IR-2012-65, a plan “to help U.S. citizens residing overseas, including dual citizens, catch up with tax filing obligations and provide assistance for people with foreign retirement plan issues.”
IRS Commissioner Doug Shulman said, "Today we are announcing a series of common-sense steps to help U.S. citizens abroad get current with their tax obligations and...
On Tuesday, March 20, Congresswoman Carolyn Maloney of New York, Ranking Member of the House Committee on Financial Institutions and Consumer Credit, put a direct question to Treasury Secretary Timothy Geithner concerning the difficulties overseas Americans are increasingly encountering in maintaining or opening bank accounts abroad, where they live and work and need access to financial services.
In response, Secretary...
On February 8, the Treasury Department issued new regulations related to the reporting required of “foreign financial institutions” under the Foreign Account Tax Compliance Act (FATCA). Click here for a New York Times article on the changes.
As pointed out in that article, however, the new regulations do not address the concerns of individual filers abroad, alarmed at the extensive...
On January 9, the IRS announced that it was yet again reviving its program inviting those with undeclared accounts abroad to declare them, facing heavy penalties for not having filed previously but, in some cases, avoiding even higher penalties. Click here for the Bloomberg News article on this from the New York Times. Note that, as reported by the Associated...
While everyone knows (or should) that “U.S. persons” (citizens and green card holders) are required (above a very low minimum) to report their worldwide income to the U.S. Internal Revenue Service, many do not actually owe tax because of credits given under tax treaties and because of the Foreign Earned Income Exclusion (FEIE), now $92,400, credited against earned income (not...
